Blackstone offers $2 billion for Finnish real estate firm Sponda

Tuomas Forsell, Jussi Rosendahl

3 Min Read

HELSINKI (Reuters) - U.S. private equity group Blackstone Group (BX.N) said on Monday it had offered to buy all shares in Finnish real estate investment company Sponda SDA1V.HE for about 1.8 billion euros ($2.0 billion) as it seeks to expand its real estate business in the Nordic region.

FILE PHOTO -- The ticker and trading information for Blackstone Group is displayed at the post where it is traded on the floor of the New York Stock Exchange (NYSE) April 4, 2016. REUTERS/Brendan McDermid/File Photo

The cash offer, 5.19 euros per share, represents a premium of 20.7 percent compared to Sponda’s last closing price.

Sponda’s properties, which include office and retail spaces in Finland’s largest cities, were valued at about 3.8 billion euros in March.

“Our proposed acquisition represents another step in Blackstone’s long-standing strategy of investing in high quality real estate assets and businesses across the Nordic region,” James Seppala, Blackstone’s head of European real estate said in a statement.

Shares in Sponda jumped to trade at 5.195 by 1008 GMT (5:08 a.m. ET).

A move by an international player into Finland’s real estate sector had been expected for some time, analysts said.

“Due to Finland’s weak economic situation over the past years, this stock has been trading at a discount, and it seems that the owners did not believe it could trade at a premium any time soon,” said analyst Matias Rautionmaa from OP Equities.

“For Blackstone, this firm offers good cash flow and yield that they can distribute to owners.”